Open Sesame How Collab.net takes open-source to the next level

Wall Street hasn’t caught on to it yet, but Collab.net, Inc., a San Francisco-based open source software start-up, is about to revolutionize the multi-billion-dollar global software industry.

The four-month-old company is giving open-source programmers a chance to earn money doing what most of them previously did for free. The development promises to speed the transformation of the open-source software movement from a techie hobby into what will likely become a dominant force in the software marketplace.

If Collab.net succeeds, the company’s robust way of doing business will eventually cut the legs out from under traditional software firms that sell proprietary closed-source software products, such as Microsoft.

For the uninitiated, developers of open-source software freely share the source code that makes their programs work. Programmers armed with source code can modify, alter or improve software without needing the help or permission of the original manufacturer. In most cases, programmers then make the source code for their improvements or alterations available to other programmers.

Previously, open-source software projects were mostly voluntary activities. They developed, or floundered, somewhat haphazardly, often dependent on the personalities of those involved.

Collab.net’s more mercenary approach is designed to make such collaborations more reliable and dependable. The company is acting as an open-source switching post, linking firms looking to develop open-source software with programmers able to get the job done.

High-tech companies can contact Collab.net’s sourceXchange project whenever they want help creating new software — say, for example, a driver that lets a printer or other device they make work with the Linux operating system. SourceXchange acts as a middle-person, facilitating the process, making sure contributing programmers get paid and client companies get what they want. Collab.net collects a commission on each completed project.

More importantly, source code developed by programmers working on sourceXchange projects will be posted on the Internet, where it will be freely available to other potential users.

Collab.net’s business structure addresses concerns raised by skeptical business analysts who say volunteer open-source software programmers will eventually get tired of working for free. As the ranks of open-source programmers diminish, the skeptics say, the products they produce will be bested by more traditional proprietary software firms that motivate employees the old-fashioned way: with a paycheck.

As the open-source movement continues to mature, growing numbers of programmers will be able to liberate themselves from employment at any single proprietary software firm. Instead, they’ll increasingly be able to work on whatever they like wherever they like. It’s a sweet, and well-deserved, reward.

But programmers aren’t the only ones who benefit. The arrangement gives software buyers, particularly businesses, a better deal, too.

Rather than turn to vendors of expensive, proprietary software for custom-designed solutions, corporate customers will have access to less expensive, more rigorously tested, open-source products. The result will be more competition, even faster product development cycles and lower prices for consumers.

Whenever market forces prevent one company from dominating an industry, business executives are forced to spend more time thinking about how they can better serve customers and less time looking for ways to use a stranglehold on one type of software to eliminate competition and keep prices high.

In fact, thanks to open-source practices, a kind of high-tech software commons has already emerged. Although Linux, the open-source operating system that competes primarily with Microsoft’s Windows NT, is currently the best known open-source software program, there are dozens of others. They range from the IP protocol that makes the Internet work to Apache, a program used by website operators to store and serve information, and other similar open-source programs used by Internet Service Providers to handle the growing avalanche of email.

Hewlett Packard is the first firm to ink development contracts with Collab.net. Other companies, including some of the most prominent in the industry, are also reportedly lining up.

Meanwhile, more than 2,500 of the world’s top programmers, most of whom were recruited through word-of-mouth or Usenet newsgroups, have quickly signed up to bid on sourceXchange projects. Just imagine what it would cost a proprietary company to recruit that kind of talent, and you get an idea of the power of Collab.net’s business model.

Collab.net’s founders have the chops to make the idea work.

O’Reilly and Behlendorf are legends within the software industry. O’Reilly’s Sebastapol-based firm, O’Reilly & Associates, Inc., published many of the key technical books and manuals that transformed the Internet from a scientific oddity into what it has become today. Likewise, Behlendorf is known within the industry as a key leader of the group that created Apache, the open-source software now used on more than 55 percent of the world’s public Internet servers.

The stakes are huge. If sourceXchange gets traction, the software industry will be forever changed.

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<p>My published work since 1985 has focused mostly on public policy, technology, science, education and business. I’ve written more than 600 articles for a variety of magazines, journals and newspapers on these often interrelated subjects. The topics I have covered include analysis of progressive approaches to higher education, entrepreneurial trends, e-learning strategies, business management, open source software, alternative energy research and development, voting technologies, streaming media platforms, online electioneering, biotech research, patent and tax law reform, federal nanotechnology policies and tech stocks.</p>